Canberra Raiders take punt on legal precedent for Braddon Club development

Anyone passing the corner of Torrens, Cooyong and Donaldson streets, at the edge of Braddon across from Civic, on a weekday would likely notice the ad hoc accumulation of cars surrounding a deserted building. The unassuming appearance of the parcel of land belies the fact that it is subject to a legal battle, after the Canberra Raiders, backed by the ACT Planning and Land Authority, proposed a commercial-residential development, versus the North Canberra Community Council, which supports retaining the land for community use.

The result could determine the fate of other clubs and community facilities in Canberra. A recent opinion piece by ClubsACT chief executive Jeff House (”Clash of ideological positions for Rattenbury,” Times2, February 26, p5) starts out with a similar assessment, noting that ”the Raiders’ development will not be the last time a club in the ACT seeks to redevelop land as a way of reducing reliance on poker machines.” Otherwise, the ill-informed article does no favours for the Raiders.

For example, Mr House claims that the cost of deconcessionalising a lease to open the way for commercial development is a ”significant cost” and ”for many clubs an insurmountable barrier.” In fact, a valuation certificate provided by the Raiders estimates the concessional payout amount at a mere $315,000. This is less than a single year’s revenue from the commercial car park that the Raiders currently operate, in contravention of the Territory Plan, on the Braddon Club site.

Ironically, the car park is there to serve the Braddon Club, but there is now no club to serve. Under the Raiders’ financial strategy of turning the site into a retail, commercial and residential development, they have run down the club and then closed it. Indeed, in the past year the Raiders have closed two of their five clubs. A strategy of closing clubs, redeveloping their sites and selling them off can generate short-term profits, but it is not a sustainable strategy, as Mr House seems to think, to reduce reliance on poker machines.

The strategy also shows that the Raiders have had no interest in running the Braddon Club and are ultimately responsible for the club building falling into disuse. This arises from an inherent conflict of interest for leaseholders of clubs and other community facilities. Such leaseholders have been granted a lease at a (bargain) concessional rate to provide community facilities and social services that otherwise might not exist on the open market.

However, the land upon which the facility may be located, accessible and convenient by its very nature as a community facility, would be valuable if sold on the open market. The leaseholder may be morally obliged to spend the money required to run a community facility effectively, but he/she may also be monetarily enticed to run down the facility, render it inoperable, and then sell the land underneath it for a windfall profit. As the leaseholder would be allowed to sell off the land to the highest bidder, there would be no opportunity for another non-profit group to continue using the land for social benefit.

In the Braddon Club case, if the Raiders build retail-commercial facilities plus more than 150 residential units on the site and then sell them, opportunities to continue using the land for social purposes, such as a community centre and/or a children’s playground, will be lost forever. Indeed, the children who would move into those units, as well as children living in the substantial number of units to be built nearby, would have no playground within walking distance. The closest approximation of a playground would be the concreted Civic Skate Park, across one of Canberra’s most dangerous roads.

Local residents concerned by the Raiders’ proposal might have expected ACTPLA to consider their interests and reject the Raiders’ proposal to deconcessionalise the Braddon Club lease, required for their development plans. Instead, ACTPLA approved the proposal. The North Canberra Community Council therefore responded to residents’ concerns and opposed the Raiders’ proposed development, appealing ACTPLA’s decision to the ACT Civil and Administrative Tribunal.

Mr House is unhappy with this, believing that, as a matter of principle, community councils should not have any formal standing in ACAT. This not only begs the question as to who would have standing if not a community council, it shows he is simply out of touch. If he had taken the time to attend the ACAT hearings held from September to November last year, he would have heard the lawyers on the Raiders’ side present arguments similar to his own.

On January 10 this year the tribunal roundly rejected these arguments, partly on the basis of a continuing legislative history going back to the 1970s.

Andrew Barr was more convincing on August 23, 2007, when in response to proposed amendments to reduce the ability of community organisations to gain standing, he said: ”For the purposes of community organisations, material detriment is established if the organisation can demonstrate that the proposed development is relevant to the objects and purposes of the organisation, which is consistent with current law.”

Fundamentally, these amendments are inequitable because they could shut out community organisations from the ACAT, except with the leave of the minister.

Mr House later states that ”the council is not representative of the views of the north Canberra community and, in fact, is ignoring the greater weight of evidence in favour of the proposal”.

The truth is that in spite of a concerted Raiders campaign, where Raiders Group general manager Simon Hawkins emailed and posted letters to franchise members exhorting them to support the Raiders’ proposal, only one in four of Inner North Canberra residents who participated in the survey were sympathetic to commercial-residential development.

If we look at only the hard-copy survey responses provided by residents of Braddon and Reid who had been letterboxed, the results are even more one-sided: fewer than one in 10 respondents favoured a commercial-residential development.

Mr House concludes that ”the processes surrounding development are not always sensible and reasonable”. We agree. As Civic and its surrounds become more densely populated, demand for community space will increase, rendering the Raiders’ proposal, and the process to achieve it, neither sensible nor reasonable.

The NCCC believes that the Raiders should either sell the lease to someone who wants to run the club, or they should return the lease to the territory. The Raiders would still walk away with hundreds of thousands of dollars, and the territory would retain the ability to use this unique and uniquely situated area for purposes that best suit Canberra’s needs, such as recreation, community facilities or parkland.

In referring to a similar development proposal more than 25 years ago, a Canberra Times editorial, appropriately entitled ”Abusing the ACT leasehold system” (November 18, 1988, p8), concluded by saying, ”Any proposal to allow a change-of-purpose clause without a surrender of the lease and new auction is no better than some of the get-rich-quick, shady rezoning schemes perpetrated in the worst carpet-bagged town or shire council beyond Woop Woop.” We couldn’t agree more.

Mike Hettinger is the acting chairman of the North Canberra Community Council.